The RICS Americas Commercial Property Survey for Q3 2011 finds that Brazil was one of the strongest perfomers. Both rental and capital values increased with this tendency expected to carry on during this quarter as the Brazilian real estate market “remains firm”.
Attraction to Brazil Property
The Survey found that investors are increasingly attracted to Brazil, confirmed by the surge in demand for commercial real estate in Brazil during Q3. Demand shows no sign of slacking and commercial property transactions are expected to increase markedly before the end of the year.
For Gary Hardacre, CEO of Obelisk International, this tendency isn’t surprising, particularly when the Brazilian property as a whole is performing well ahead of most global real estate markets. “Like residential property, Brazilian commercial values are rising on the back of a market dominated by high demand and lack of supply,” Mr Hardacre comments.
Strong Capital Value Expectations
According to RICS, commercial property experts are reporting that capital value expectations for commercial property in Brazil are “rising considerably faster than in the US and Canada”. Brazil is also ahead of other countries when it comes to rental and capital values.
Commercial rental values in Brazil show high positive values in both Q3 and Q4, according to the survey and rank in third place after China and Hong Kong. This strength contrasts dramatically with the US and UK where commercial property presents negative values for both quarters.
When it comes to capital value expectations, Brazilian commercial property is predicted to experience a massive surge during Q4. During these three months, capital values will reach the second highest value globally after China.
In terms of demand for investment opportunities, Brazil ranks in fourth place behind Germany, Japan and China. Most analysts including Obelisk International believe the demand for Brazilian real estate is here to stay.
“With such strong demand drivers across the entire real estate sector, it’s difficult to see a fall in opportunities,”
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Obelisk International offers select investment opportunities in Brazil in a range of sectors such as residential real estate, construction and social housing.